Apple dominates music players, online music, smart phones and tablet computers. Steve Jobs’ dream was to dominate the TV business, too.
Apple TV (Photo credit: billaday)
There is no shortage of speculation, rumor or innuendo about iTV. Since I am in the business of detecting change before the crowd and building positions in stocks before Wall Street catches on, I carefully study the rumors. However, until recently I did not find anything in the rumor mill that will help Apple dominate the TV business in the same way it dominates other businesses.
I keep coming back to the following statement Tim Cook made to his shareholders earlier this year,
You can be assured we are working as hard as ever this year to deliver an incredible year and some products that will blow your mind.
Apple is a very secretive company. I have found two sources that are a treasure trove of information. One is the litigation that Apple is involved in and the second is the U.S. Patent and Trademark Office.
Could it be that the secret weapon Apple has to win the TV business is advertisement skipping technology? There is some credibility to this line of thinking. If Apple was the only company offering TV sets where commercials could be skipped on live TV, Apple would have an edge.
Yesterday Apple was granted patent number 8,249,497 for ad skipping technology. Here is the abstract:
Systems and methods are provided for seamlessly switching media playback between a media broadcast, such as a radio broadcast, and media from a local media library. When an electronic device determines that an upcoming media item in a media broadcast is not of interest to a user, the electronic device can switch playback from the media stream to a media item from the electronic device local library. The selected local media item can be related to a previously broadcast media item to ensure continuity in the user's listening or viewing experience. The electronic device can switch away from the local media item and return to the media stream when the media stream again broadcasts media items or segments of interest to the user.
The first claim of the patent as described below clarifies the concept:
A method for seamlessly switching between two content sources, comprising: receiving a first media stream from a first media source, wherein the first media stream comprises a first plurality of media items; sequentially playing back the first plurality of media items of the received first media stream; determining that an upcoming media item of the first plurality of media items of the received first media stream is not of interest to a user; identifying second media that is of interest to the user; and switching playback from the first media stream to the identified second media when the upcoming media item is received.
In simpler words, Apple iTV would detect a commercial and automatically replace the commercial with a different show or other content, and then go back to the original show when the commercial is over.
In case of a radio broadcast, including those from Pandora (P), commercials would automatically be replaced by a segment of another song that you like.
Of course Apple will have to find a way to appease broadcasters such as Disney (DIS), CBS (CBS), and Comcast (CMCSA).
About Me: I am an engineer and nuclear physicist by background. I founded two Inc. 500 companies, and have been involved in over 50 entrepreneurial ventures. I am the chief investment officer at The Arora Report, which publishes four newsletters to help investors profit from change. Write me: Nigam@TheAroraReport.com. Follow me here and get email notification when I publish a new article.
Full disclosure: Subscribers to The Arora Report are long Apple from $131 and have taken partial profits at $360, $525, $629 and $568.
